Spanish Banks’ 9M 2022 Results: Net Interest Income Growth Starting to Benefit Profitability
DBRS Morningstar released a commentary on the 9M 2022 results of large Spanish banks. Summary highlights from the commentary include:• Large Spanish banks posted a domestic aggregated profit of EUR 6.1 billion in 9M 2022 up from EUR 3.1 billion in 9M 2021, with all banks reporting a significant annual growth of Underlying Net Attributable Income.
• The good domestic performance is explained by number of factors, including positive dynamics in Net Interest Income, which was up 6% Quarter-on-Quarter and 1% Year-on-Year in 9M 2022
• Banks are also benefiting from the restructuring plans they executed in 2021. As a result, several banks posted a reduction in domestic operating costs YoY.
• Despite the solid 9M results and the positive outlook for NII, Spanish banks will navigate an uncertain environment with many headwinds in coming quarters.
“DBRS Morningstar considers that Spanish banks will continue to benefit from higher interest rates and the NII outlook continues to be positive during next quarters” said Pablo Manzano, Vice President from the DBRS Morningstar Global Financial team. “However, there are also negative headwinds including a weaker economy, the likely new financial tax and a potential mortgage moratorium for vulnerable borrowers in Spain”.
Banco Santander is a holding company, providing a range of financial products. Co.'s products and services include: retail banking business that covers all customer banking businesses; wholesale banking business; as well as asset management and insurance business. Co.'s principal operations are in Spain, the U.K., Portugal, Germany, Italy and Latin America. As of Dec 31 2014, Co.'s total assets amounted to Euro1,266,296,000,000 and total customer deposits amounted to Euro647,627,000,000.
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